Briefing: AI startup Megvii raises $750 million in new round of funding

What happened: Artificial intelligence (AI) startup Megvii has raised $750 million in a new round of funding. The fundraising brings the company’s valuation to more than $4 billion prior to a Hong Kong IPO later this year. Bank of China’s equity arm led the fundraising with $200 million. Also involved were Macquarie Group, ICBC Asset Management, Alibaba, and a wholly-owned subsidiary of the Abu Dhabi Investment Authority, one of the world’s largest sovereign wealth funds.

Why it’s important: Chinese and foreign investors are pumping money into artificial intelligence and facial recognition startups in China as the government prioritizes the technology’s development and use. Facial recognition applications have become ubiquitous in China, being used for everything from payments to tracking people’s whereabouts. Megvii’s technology is used by the Chinese government, as well as companies like Alibaba, Huawei, and Ant Financial. China aims to become a leader in AI by 2030 and overtake rivals like the US. Sensetime, the most valuable AI startup in the world worth nearly $8 billion, also hails from China.